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Unlocking Housing in North Tandridge Business Case

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Unlocking Housing in North Tandridge Business Case COAST TO CAPITAL LOCAL GROWTH FUND BUSINESS CASE Project Title: Unlocking Housing in North Tandridge Lead delivery organisation: Tandridge District Council Lead contact name: Alison Boote, Interim Executive Head of Communities, Tandridge District Council Version No: Issue Date: 23 July 2020 This document provides a template for a Business Case (BC) in support of Coast to Capital’s investment in a project to be funded through the Local Growth Fund. The main purpose of the BC is to put forward the case for change and the preferred way forward identified in an internal Strategic Outline Case (SOC); which establishes the option which optimises value for money; outlines the deal and assesses affordability; and demonstrates that the proposed scheme is deliverable. In practice, you will find this entails updating the strategic case; undertaking investment appraisal within the economic case; and completing the commercial, financial and management cases, with supporting benefits and risk registers. Please note that this template is for guidance purposes only and should be completed in accordance with any guidance issued by Coast to Capital and the guidelines laid down in HM Treasury’s Green Book which can be found at https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/220541/gr een_book_complete.pdf The OBC should cover the 5 cases – the Strategic case, the Economic case, the Commercial case, the Financial case and the Management case. Business cases should be robust and well evidenced documents as the Business Case will be evaluated based upon content if called to present. Coast to Capital Disclaimer There shall be no expectation of grant payment unless and until a funding agreement is signed by both parties. All the Applicant’s costs and charges incurred as a result of making this application shall be for the Applicant’s account and cannot be claimed as part of the project except where feasibility funding has been prior awarded. 1. Executive Summary 1.1) Overview of the project including what opportunity or barrier the investment will unlock: Background The North Tandridge area is made up of the town of Caterham, the largest town in Tandridge district, and a number of smaller, adjacent communities, including Warlingham, Whyteleafe and Chaldon. The area serves a population of approximately 40,000. The North Tandridge area has clear locational advantages. It is one of the best served in the South East for rail services, with 7 stations connecting to London Bridge and London Victoria in under 25 minutes and Croydon in 5 minutes. Proximity to Junction 6 of the M25 provides access to Gatwick Airport (20 minutes) and Heathrow Airport (30 minutes) as well as good connectivity to the Kent seaports. Biggin Hill airport which is a popular business hub, is also accessible in under 10 minutes and the area is on the doorstep to Croydon which is undergoing substantial regeneration. North Tandridge also forms part of a wider East Surrey economy, which performs strongly in the Coast to Capital (C2C) area in respect of GVA, and is also located within the Gatwick Diamond, A23/M23 strategic corridor region. Despite these advantages, the area underperforms economically and faces a number of barriers to growth. These barriers include restrictive Green Belt policies (approximately 94% of Tandridge district is Green Belt) which impact the availability of land for commercial and residential development. This has seen the area become one of the most unaffordable in the country with house prices 14 times the average salary. This has had a significant impact on local businesses, in respect of being able to recruit and retain staff. It has also seen the area particularly impacted by the effects of permitted development rights which has seen 11% of commercial space lost across the region over the last 5 years. With no end in sight to this national policy, this trend is likely to continue. As a result of these issues, the area is seeing an unsustainable demographic swing. Over 65s already make up 18% of the population. Over the next 10 years, this age group expected to grow by 29% (with an increase in over 85s by 40%) which will see the area’s already comparatively high economic inactivity rates increase. This will further exacerbate issues relating to workforce availability. It is also likely to have an impact on high streets in North Tandridge which are already in decline and rely on a sustainable demographic mix to remain viable. Viability of town centres is a key issue for the area. The Caterham Masterplan, adopted by Tandridge District Council in March 2018 identified that the area performed poorly against comparable areas and faces a number of barriers to growth. This includes competition from Redhill, Crawley, Croydon and Bluewater, a poor commercial offer based around low value and mid-range retailing (which is not reflective of the local demographic) and access, public realm and streetscape issues that affect the area’s wider appeal as a leisure/recreation destination which is particularly important given the impact of online shopping and move to ‘experiential’ shopping. Road infrastructure is also a major barrier to growth. The area is accessed directly by Junction 6 of the M25 which is rapidly approaching capacity and the A22 also experiences congestion. This will be further exacerbated by the ongoing and planned growth in Croydon and the planned garden community in South Godstone. Flooding also continues to be an ongoing issue for local businesses, particularly in Caterham and Whyteleafe. Most recently, in June 2016 a flash flood occurred in Caterham which overwhelmed the local road and drainage infrastructure resulting in internal and external residential and commercial property floods. Many of the internal property floods included sewage including a number of retail units in Caterham Valley town centre. 2 These issues have had a huge impact on the ability for businesses to grow and locate in the area. Over the last 20 years, North Tandridge has lost many of its major employers. It has also seen the economy move toward low-value, low-skilled sectors, which is at odds with its highly educated population and advantageous location. This has resulted in a high degree of out-commuting. The wider district experiences a net loss of over 8,700 people each working day. Not only does this create a dormitory effect but it also has an impact on the viability of town centres and road and rail congestion. In order to address these issues, a Local Growth Fund application was submitted in 2017 for a £4.945 million project to unlock housing by relocating two existing Community Recycling Centres (CRCs) to a modern, fit-for-purpose site which would release the existing sites, in Caterham and Warlingham, for housing development. The Coast to Capital Board conditionally agreed this application, with a small amount of the identified funding drawn down in 2017/18 (£30,000) on the basis an updated application would be submitted in the 2018/19 year for the remaining funding. Conditional agreement of this application provided a catalyst for the project to expand into a wider, more ambitious programme of work undertaken in partnership with Surrey County Council, Tandridge District Council, NHS East Surrey (now Surrey Heartlands) Clinical Commissioning Group (CCG) and private sector partners. There has been significant work carried out on this positive and extensive project which is scheduled to continue through to 2030. A total of £19.5 million has already been spent with a further £10.68 committed by Tandridge District Council. This Programme will not only enable much-needed housing to be provided but will look more broadly at addressing issues relating to provision of commercial space, vitality of town centres and the infrastructure associated with this. Programme aims and objectives The key aims of the Programme are as follows: 1. Delivery of new affordable and market housing 2. Protection of existing and delivery of new commercial floorspace 3. Enhancement of town centres For each of these priorities a number of objectives have been identified. These are as follows: a) Redevelopment of public sector sites Phase 1 of the Programme has identified opportunities for public sector assets to be released for alternative residential, commercial or shared public-sector use. These assets include libraries, schools, hospitals, day centres and community centres. A list of assets is attached as Appendix A. This work has been undertaken in partnership by Surrey County Council, Tandridge District Council and NHS East Surrey (now Surrey Heartlands) Clinical Commissioning Group (CCG), working closely with NHS Property Services. As part of this work, the now Surrey Heartlands Clinical Commissioning Group, will continue to look at a strategic outline case for redevelopment of the Caterham Dene Hospital site and adjacent Caterham Dene fields to a mixed-use health and residential site. This work has been affected by the delay to the Tandridge Local Plan. The Examination in Public was held in November 2019, which was later than scheduled in the anticipated programme. The further timetable from the Inspector is at this stage unknown. Following his initial findings further modification and consultation will be required and final adoption is scheduled for not earlier than January/March 2021. Phase 1 will also continue work to consider the existing Community Recycling Centres (CRCs) in Warlingham and Caterham to be unlocked for redevelopment. Both sites suffer major access issues and proposals are to be progressed for relocation to a modern, more accessible site. The unlocking of the CRCs will also act as a catalyst to bring other sites forward for redevelopment. Initial modelling has identified a potentially suitable CRC site on an existing Surrey County Council-owned depot, located in Godstone, on the A25 close the Junction 6 of the M25.
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